Highlights

  • Paytm layoffs over 1000 employees
  • The job reductions are part of Paytm's broader strategy

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Mass layoffs at Paytm: Over 1000 employees let go amid cost cutting

This action by Paytm adds to the increasing trend of job cuts in Indian startups in 2023, with over 28,000 individuals laid off by new companies in just six months, as per ET report

Mass layoffs at Paytm: Over 1000 employees let go amid cost cutting

Following the footsteps of Byjus, PhysicsWallah, Udaan, and Third Wave Coffee, Paytm's parent company, One 97 Communications, has undertaken a significant workforce reduction by terminating more than 1,000 employees across various departments.

Paytm's Focus on Cost Efficiency

This strategic move, aimed at streamlining operations and reducing costs, marks one of the most substantial workforce reductions witnessed in the Indian tech sector this year, according to a report by The Economic Times (ET).

Most of the job cuts are concentrated in Paytm's lending business, which had seen significant growth in the past year. While the exact number of affected employees was not disclosed, a Paytm spokesperson shared with ET that the company aims to reduce staff costs by 10-15 percent in the current financial year. As of September, Paytm had Rs 8,754 crore in cash balances.

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The job reductions are part of Paytm's broader strategy to realign its business operations. Recent changes, including stepping back from small-ticket consumer lending and discontinuing its "buy now pay later" lending segment on the UPI platform, have contributed to this strategic shift. These layoffs impact over 10 percent of Paytm's total workforce, and the company anticipates further cost-cutting measures as it adapts its operational structure.

The evolution of Paytm Postpaid, previously offering loans below Rs 50,000, now shifting towards wealth management, has been a pivotal change. However, the company faced challenges as its stock dropped approximately 20 percent on December 7 following the discontinuation of the Paytm Postpaid loan plan.

Startup layoffs in 2023

This action by Paytm adds to the increasing trend of job cuts in Indian startups in 2023, with over 28,000 individuals laid off by new companies in just six months, as per ET reports. This acceleration in layoffs has been ongoing since 2022, with global tech giants like Meta and Amazon significantly reducing their staff.

Apart from Paytm, other tech startups like PhysicsWallah, Udaan, Third Wave Coffee, and Bizongo have also witnessed significant layoffs this year. Moreover, industry giants like Flipkart and Byjus have chosen not to provide appraisals to top performers, showcasing the changing dynamics within India's tech ecosystem. This news comes in the wake of Fintech startup ZestMoney announcing its shutdown after an unsuccessful attempt to revive its business.


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